Patrons' Net Margins shall be payable to him in cash at the close of each fiscal year, but the legal offset of the payments due a patron against the obligation of such patron to subscribe for capital, as provided in section 1 (b) of this Article X, shall constitute full and complete discharge of the obligation of the association to make payment as herein provided.

SECTION 4. Lien.

This association shall have a first lien on the interest of each patron in the Patrons' Net Margins for all indebtedness of such patron to this association.

SECTION 1. Purpose.

Article XI-Revolving Fund

This association shall establish and maintain a revolving fund for the purpose of acquiring and maintaining adequate capital to finance its business.

SECTION 2. Investment in Fund. This association may require investment in its revolving fund as provided in Article X, Section 1 (b) of these bylaws. Proper entries shall be made in the books and records of this association so that the net credit to each holder of an interest in the revolving fund in each year can be ascertained at any time. This association may issue revolving fund certificates to evidence credits in such fund, and the certificates may be in such form and contain such terms and conditions not inconsistent with this Article XI as the board of directors may prescribe.

SECTION 3. Operation. Investments in the revolving fund need not be segregated from, but on the contrary may be invested in or commingled with, any other assets of this association. No dividend, interest, or any other income shall be declared or paid on account of any net credits in the revolving fund. This association shall have a first lien on each revolving fund credit for all indebtedness of the holder thereof to this association.

SECTION 4. Repayment. If and when in the judgment of the board of directors the net balance in the revolving fund shall exceed the amount of capital reasonably needed by the association, it shall apply such excess to the retirement, in full or pro rata, of any or all the net credits in the revolving fund; provided, that such certificates shall be retired in the order of issuance by years and there shall be no discrimination between investments received in the same fiscal year. Notwithstanding any other provision of this section the board of directors, in its discretion, may retire any net credits at any time when the holder shall either (a) die, or (b) otherwise cease to be a producer, or (c) remove from the territory served by the association.

SECTION 5. Transfer. No assignment or transfer of any revolving fund shall be binding on this association without the consent of the board of directors nor until it shall have been entered in the books of this association.

Article XII-Dissolution

Upon the dissolution of this association, all debts and liabilities of this association shall first be paid according to their respective priorities. The holders of credits in the revolving fund shall then be paid the amount of their credits in said fund. Holders of membership in the association shall then be paid an amount equal to the membership fee which they paid in order to acquire membership in the association. Any remainder of such property shall be distributed among the patrons who patronized the association during the five (5) fiscal years immediately preceding dissolution on the basis of their respective patronage as shown by the records of this association.

If the association is formed with capital stock, it is suggested that this section be changed to read as follows:

Article XII-Dissolution

Upon the dissolution of this association, all debts and liabilities of this association shall first be paid according to their respective priorities. Any property remaining after discharging the debts and liabilities of this association shall be distributed to the stockholders and patrons of this association. Holders of shares of preferred stock shall first be paid, and shall be limited to, the par value of their preferred shares, plus any dividends declared thereon and unpaid. Holders of shares of common stock shall next be paid, and shall be limited to, the par value of their common shares. Holders of credits in the revolving fund shall then be paid the amount of their credits in said fund. The remainder of such property shall be distributed among the patrons who patronize this association during the five (5) fiscal years immediately preceding dissolution on the basis of their respective patronage as shown by the records of this association.a

1

Article XIII-Unclaimed Money

A claim for money against the association shall be subject to the provisio of this section whenever the association is ready, able, and willing to pay suc claim, and has paid or is paying generally claims arising under similar circur stances, but payment of such claim cannot be made for the reason that t association does not know the whereabouts or mail address of the one to whe it is payable or the one entitled to payment. If such claim be not actual paid within a period of --years 30 after it became payable as here provided, the association shall remove the claim as a liability on its book: provided that no such removal shall be made unless at least 30 days prior there the association shall have sent by registered United States post, with the retur receipt requested, a written notice of the proposed removal, addressed to the person appearing from the association's records to be entitled to payment such money at the last address of such person shown by the records of th association. If any such claim be removed of record after giving such notic the claim shall be deemed extinguished but the association shall continue t maintain a memorandum record of such claim and shall pay the princip amount thereof without interest to any claimant who subsequently establishe to the satisfaction of the association his right to receive payment. Any an all amounts recovered by the association pursuant to this Article, after deducting therefrom the amount of any taxes payable thereon, shall be placed in the

Whether this or some other priority of payment should be prescribed will depend primarily (1) upon the requirements of applicable State law, and (2) the intended pla of operation. If the State law permits a choice, whether preferred stockholders should be paid prior to holders of revolving fund interests, or vice versa, would be influence by whether the cooperative deems it advisable to favor one method over the other as a means of raising capital.

30 Insert here a period equal to the applicable statute of limitations with respect t

I

C

eserve account of the association established under Article X, Section 2 (b) (2). Any claim paid after the expiration of the period of years herein specified shall e deducted from such account.

Article XIV-Fiscal Year

The fiscal year of this association shall commence on the first day of each year and shall end on the last day of

of the following year.

Article XV-Miscellaneous Provisions

SECTION 1. Bylaws Printed. After adoption, these bylaws, preceded by the rticles of incorporation, shall be printed in pamphlet form and a copy thereof hall be delivered to each member and to each person who later becomes a nember of the association as shown on the books of record.

SECTION 2. Seal. The corporate seal of this association shall have inscribed on it the name of the association,

nd the year of incorporation,

Article XVI-Amendments

If notice of the character of the amendment proposed has been given in the notice of meeting, these bylaws may be altered or amended at any regular or pecial meeting of the members by the affirmative vote of a majority of the nembers present or voting by mail. We, the undersigned, being all of the incorporators and members of the Association, do hereby assent to the foregoing ylaws and do adopt the same as the bylaws of said association; and in witness vhereof, we have hereunto subscribed our names, this

day of

Waiver of Notice of First Meeting of Members

We, the undersigned, being all of the incorporators of

(Name of association)

of

constituting all of the present members of such association, hereby waive notice of a meeting of the members and consent to the holding of a meeting of such t members at

o'clock
19____, at

M. on the

(Place of meeting)

in

day of

(Town)

(State)

for the purpose of adopting bylaws for the government

of the association and transacting any other business that may properly come

(State)

(Day)

(Place of meeting) for the purpos

of electing officers of the association to serve during the ensuing year, adopting the form of marketing agreement, and transacting any other business that ma properly come before said meeting.

Witness our signatures this

day of

upon

The chair called for proof of notice of the meeting, where presented a waiver of notice and consent to hold the meeting signed by all of the members of the association, which waiver and consent was in the following form:

(Copy waiver of notice and consent to meeting.)

The chair ruled that the meeting was properly called and it was ascertained that all the members of the association were present. The chair reported that the articles of incorporation of the association were filed on the o'clock in the ----noon, in the

-

19__, at

day of ___ office of the Secretary of State of the State of --, and presented a copy of said articles of incorporation, which was read, and on motion duly made, seconded and carried, was directed to be entered in full in the minute book. (See page.) A draft of proposed bylaws for the government of the association was presented by and was read to the meeting and discussed section by section and as a whole, and the proposed bylaws were unanimously adopted. Each member affixed his signature to the bylaws and the secretary was instructed to spread the bylaws on the minutes of this meeting.

(Here insert record of any other business that may have been transacted.) There being no further business to come before the meeting, on motion duly made, seconded, and unanimously adopted, the meeting was adjourned.

(Temporary Chairman)

(Temporary Secretary)

The first meeting of the board of directors of the

Upon convening

nd

umed his office.

was elected temporary chairman temporary secretary of the meeting, and each as

The chair called for proof of notice of the meeting, whereupon.

presented a waiver of notice and consent to hold the meeting, igned by all the directors of the association, which waiver and consent was written as follows:

(Copy of waiver of notice and consent to holding meeting.)

Upon roll call of the directors of the association, the following answered

resent:

(Record the names of all directors present.)

The chair ruled that proper and legal notice of the meeting had been given And that a quorum was present, and announced that the meeting was open or transacting business.

The chair stated that the meeting was called for the purposes of electing officers 31 of the association for the ensuing year and transacting any other ›usiness that might properly come before the meeting.

Upon motion duly made and seconded, the following officers were unaninously elected to serve at the discretion of the board until the time of the first regular meeting of the board to be held as soon as practicable following the irst annual meeting of the stockholders.31

(Record the names of the officers elected and the title of office.)

Following the election of the officers,31 the president took the chair, and the secretary assumed the duties as secretary of the meeting.

Upon motion duly made, seconded, and carried, the following were appointed members of the executive committee, as provided in the bylaws. (Record the names.).

Upon motion duly made and seconded, the following resolution was adopted: Resolved, that the Executive Committee be charged with the following specific powers and duties:

(State here the specific powers and duties which it is desired to delegate during the period when the directors are not in session, subject to the general direction of the board.)

Upon motion duly made and seconded, the following resolution was adopted: Resolved that the president and secretary be, and they are hereby, author

"Omit if the officers are named in the articles of incorporation.